Ann: Kaiser Bill JORC Update, page-8

Cut off grade is a complicated field. If you need to know, then Lane's Economic Definition of Ore is the ultimate textbook, if a difficult read.

There's any number of cut off grade formulas applied for different purposes. However, when mining, it's most important to identify the appropriate fixed costs and include these at the appropriate place in the equation. Fixed costs include cost of capital.

Unless done properly, spreading costs between several deposits can be a very dangerous strategy.